- An growth in the Ethereum validator queue suggests that additional investors may be drawn to the restaking boom.
- Ethereum’s burn rate is higher than emissions, indicating deflationary trends.
- Given that bearish appear to be running out of steam, Ethereum may continue trading sideways.
Wednesday saw Ethereum (ETH) remain in a sideways trend as investors appeared to be waiting for a catalyst to push the price higher or lower. The ETH validator queue increased significantly in spite of the price stagnation, perhaps due to the DeFi restaking surge.
Daily digest market movers: validator queue, restaking boom, token burns, whale deposits
Due to the sluggish market movement on Wednesday, Ethereum’s price has not yet increased. The following are significant marketmovers for the top altcoin:
- According to data from Validator Queue, Ethereum’s validator queue increased significantly in April, rising by more than 150% to reach 21,551, its highest level since September 2023. The number of active validators in the network is also getting close to one million; on January 1, there were about 902,884 validators, and as of April 17, there were 984,375.
- The increasing popularity of Ethereum restaking as a means of optimizing returns is the reason behind the spike in interest among validators. Eigenlayer makes it possible for users to get extra incentives by staking Ethereum tokens and utilizing them to secure other protocols, like as rollups, oracles, and bridges. According to CoinGecko, the total amount of ETH that was restaked increased by 36% in Q1, with over 4.3 million tokens restaked on Eigenlayer. 2.28 million restaked Ethereum were accounted for using liquid restaking mechanisms.
- More than 113,000 ETH were removed from circulation in Q1, according to CoinGecko, meaning that the burn rate of ETH is exceeding its emissions. About 333,600 ETH were burned in Q1 overall, compared to 270,500 ETH that were emitted. This suggests that even with no supply constraint, token burning are progressively turning ETH into a deflationary currency.
- CoinGecko’s Q1 analysis on the cryptocurrency market also noted the rise in Ethereum Layer 2 adoption. Following the reduction of gas taxes through the adoption of Ethereum Improvement Proposal EIP-4844 in the Dencun update, L2s witnessed over 900 million transactions in Q1 of this year.
- According to Santiment, there has been a rise in false information on the second-largest digital asset since the market drop, even if some whales purchased the bottom by shifting ETH across exchanges in the last week. According to Spot On Chain, Celsius network made its biggest ETY deposit in three months on Wednesday when they sent $24.5 million worth of 8,091 ETH to Coinbase. Celsius transferred 847,626 with an average value of $1.9 billion to many centralized exchanges between November and January.
Lookonchain reports that a different whale appeared to be profiting from his September purchase of 96,638 ETH for $1,567 from Coinbase, as he deposited 5,000 ETH to Kraken on Tuesday.
Technical analysis: ETH to maintain sideways movement
Ethereum is still trading close to the $3,000 support level and has had difficulty moving higher on Wednesday. It has kept moving in a sideways, downward direction because there isn’t currently a catalyst for a big price change.
As ETH keeps covering the liquidity gap created on Saturday, a momentary halving of Bitcoin might push it higher to meet the gap left by April 12’s liquidity. ETH must overcome a significant barrier, $3,406, which was established on April 7.
As previously mentioned, ETH may trade between $2,852 and $3,301 over the course of the next several days, barring the occurrence of significant events. The tension between Iran and Israel, the popularity of Bitcoin, and the Securities & Exchange Commission’s (SEC) decision to approve ETH are some of these factors.
Another thing to observe is that, in contrast to the previous two days, ETH long liquidations have slowed considerably. The total amount of long liquidations in the last day is $29.3 million. This suggests that bear traders might be losing momentum, therefore another drop in price below the previously mentioned range is unlikely.
As of this writing, ETH is trading at $2,989 per unit.